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Chris
10-11-2012, 11:15 PM
This will return us to the spirit of my series of threads generally titled "Economics is Fun". This one is "The Numbers Game". I will post them when I find them.

Russ Roberts, isn't as fun, but he brings economics down to earth so most anyone interested can understand, though not necessarily agree!


http://www.youtube.com/watch?v=1eCYq2vD5GY

This is part one, I'll post part 2 when I see it.

If you click and go to youtube, you will find references to papers on what they're discussing.

If you go to Russ Roberts: Why Keynesians Always Get it Wrong (and Most Economists Too) (http://reason.com/reasontv/2012/10/11/russ-roberts-on-the-economic-fallicies-o), in which Roberts is interviewed, you'll get some background on who he is and what school of economics he generally follows. I've been listening to his podcasts at EconTalk (http://www.econtalk.org/) for years.

head of joaquin
10-12-2012, 08:26 PM
Hey kids, let's pretend that the Bush meltdown had nothing to do with the income gap and the bubble caused by tax cuts. No serious economist discounts the stimulus power of government spending during a recession. It's econo 101, even for monetarists (though they disagree about the ultimate benefits and most efficient ways of proceeding).

Let's pretend.

http://a.wattpad.net/cover/2170085-256-295684.jpg

Chris
10-12-2012, 08:33 PM
No serious economist discounts the stimulus power of government spending during a recession. It's econo 101, even for monetarists (though they disagree about the ultimate benefits and most efficient ways of proceeding).

Ignoring your poisoning of the well, it is true, in general, both monetarists and Keynesians advocate stimulii.

Problem is, as is discussed in the Robert's interview, neither monetarists nor Keynesians have any factual evidence to support what is otherwise wishful thinking.

Peter1469
10-12-2012, 08:34 PM
Hey kids, let's pretend that the Bush meltdown had nothing to do with the income gap and the bubble caused by tax cuts. No serious economist discounts the stimulus power of government spending during a recession. It's econo 101, even for monetarists (though they disagree about the ultimate benefits and most efficient ways of proceeding).

Let's pretend.

Yes they do. You are limiting your economic view to the Keynesian school (and neo-Keynesian). We have seen the failure of government spending through QE1, 2, and now 3. Lets look at QE3. It is a promise that the fed will buy $40B per month of troubled assets (worthless mortgage derivatives) for an unlimited period of time. (That was the basis of TARP under Bush and the fed then said that would be a stupid investment and used the money for other stuff). The top 5 banks in the US have ~$200T of these assets off their books (because the mark to market rule was suspended). It is going to take a lot of months to buy off that much!

So why has the stock market been largely flat, if not down, since QE 3 started? According to you Keynesians it should be up.

The Great Depression proved that Keynesian economics was a failure. The slow students just have not caught on yet.

head of joaquin
10-12-2012, 09:14 PM
Ignoring your poisoning of the well, it is true, in general, both monetarists and Keynesians advocate stimulii.

Problem is, as is discussed in the Robert's interview, neither monetarists nor Keynesians have any factual evidence to support what is otherwise wishful thinking.

Except that it prevented a Second Great Depression, which would have resulted from spiraling deflation. Nobody takes Austrians seriousless but kooks in compounds hoarding gold.

How's that hyperinflation thingie coming, by the way? Still just around the corner?

A huge increase in the money supply, and almost zero inflation. What does that tell you?

head of joaquin
10-12-2012, 09:15 PM
Yes they do. You are limiting your economic view to the Keynesian school (and neo-Keynesian). We have seen the failure of government spending through QE1, 2, and now 3. Lets look at QE3. It is a promise that the fed will buy $40B per month of troubled assets (worthless mortgage derivatives) for an unlimited period of time. (That was the basis of TARP under Bush and the fed then said that would be a stupid investment and used the money for other stuff). The top 5 banks in the US have ~$200T of these assets off their books (because the mark to market rule was suspended). It is going to take a lot of months to buy off that much!

So why has the stock market been largely flat, if not down, since QE 3 started? According to you Keynesians it should be up.

The Great Depression proved that Keynesian economics was a failure. The slow students just have not caught on yet.

Pssst: you're arguing against yourself. If we can increase the money supply that much and still have almost no inflation, think about the deflationary spiral Bush's meltdown would have caused had we not increased the money supply.

Connect the dots.

Peter1469
10-12-2012, 09:18 PM
Pssst: you're arguing against yourself. If we can increase the money supply that much and still have almost no inflation, think about the deflationary spiral Bush's meltdown would have caused had we not increased the money supply.

Connect the dots.

We have inflation is some areas of the economy, fuel and food, and deflation in other areas of the economy, like home prices.

Personally, I will take deflation over inflation. That is better for savers. Inflation is better for those who live beyond their means.

Had we not increased the money supply, food and fuel would not be so high today.

Chris
10-13-2012, 03:03 AM
Except that it prevented a Second Great Depression, which would have resulted from spiraling deflation.

Explain how you know this is true. Let us know how you measure the supposed multiplier effect, and what counterfactuals exist. Demonstrate that stimuli did not make things worse by prolonging recovery, which is, in fact, what has happened.

Chris
10-21-2012, 02:33 PM
Part 2...


http://www.youtube.com/watch?feature=player_embedded&v=ooUbohNneCQ

Again, go to youtube to access papers behind what they're talking about.

Chris
10-22-2012, 06:00 AM
Now if you've viewed the above videos, you'll know what's wrong with Krugman's analysis:
The answer — backed by overwhelming evidence — is that this is what normally happens after a severe financial crisis....

About the evidence: The most famous study is by Harvard’s Carmen Reinhart and Kenneth Rogoff, who looked at past financial crises and found that such crises are typically followed by years of high unemployment and weak growth. Later work by economists at the International Monetary Fund and elsewhere confirmed this analysis: crises that followed a sharp run-up in private-sector debt, from the U.S. Panic of 1893 to the Swedish banking crisis of the early 1990s, cast long shadows over the economy’s future. There was no reason to believe that this time would be different.

@ The Secret of Our Non-Success (http://www.nytimes.com/2012/10/22/opinion/krugman-the-secret-of-our-non-success.html?_r=1&)

True, recoveries are slow, but that overgeneralization covers up the difference: if you compare previous recoveries from recessions and the Great Depression you'll see a much sharper incline in recovery than we're now seeing.

WHy's Krugman overgeneralize? Look at his article to see what I elided. Krugman's less an economist these days than a political hack.

Trinnity
10-22-2012, 06:16 AM
Except that it prevented a Second Great Depression, which would have resulted from spiraling deflation. Prove it. I'll wait.

Chris
01-14-2013, 08:15 PM
Part 3 focuses on uncertainty...


http://www.youtube.com/watch?feature=player_embedded&v=oLOH2d_p7_E#!

Dr. Who
01-22-2013, 11:03 PM
This will return us to the spirit of my series of threads generally titled "Economics is Fun". This one is "The Numbers Game". I will post them when I find them.

Russ Roberts, isn't as fun, but he brings economics down to earth so most anyone interested can understand, though not necessarily agree!


http://www.youtube.com/watch?v=1eCYq2vD5GY

This is part one, I'll post part 2 when I see it.

If you click and go to youtube, you will find references to papers on what they're discussing.

If you go to Russ Roberts: Why Keynesians Always Get it Wrong (and Most Economists Too) (http://reason.com/reasontv/2012/10/11/russ-roberts-on-the-economic-fallicies-o), in which Roberts is interviewed, you'll get some background on who he is and what school of economics he generally follows. I've been listening to his podcasts at EconTalk (http://www.econtalk.org/) for years.

Arrgh ... I hate waiting for part II! In this case it hopefully answers the questions, considering the fact that this particular economic disaster has some very unique features which the previous economic down turns did not have.

Chris
01-23-2013, 08:24 AM
Dr. Who, parts II and III are above.

Chris
03-17-2013, 07:58 PM
Part IV!!! Parts I, II, III are above.


http://www.youtube.com/watch?feature=player_embedded&v=1qIjnKd2Zzc#!



Why has the current recovery from the Great Recession been so mediocre? Ed Leamer of UCLA points out that the last three recessions have all had mediocre recoveries of both output and employment. His explanation is that changes in the manufacturing sector have changed the pattern of layoffs, recalls and hiring during recessions and recoveries. The conversation concludes with a discussion of the forces driving the changes in the labor market and the implications for manufacturing.

1) Why the last three recessions all look different (1:44)
2) Employment growth for last eight recessions (4:12)
3) Why have the last three recessions been so different? (6:13)
4) The jobs cycle in manufacturing (8:52)
5) Excess capacity in construction has created a lag (10:33)
6) Manufacturing output versus manufacturing employment (11:14)
7) What’s the solution to the downturn? (12:20)


LINKS TO DATA REFERENCED –
1. Real GDP Growth From Peak to Peak Charts:
FRED — “Real Gross Domestic Product, 3 Decimal (http://research.stlouisfed.org/fred2/graph/?id=GDPC96). Note: Calculated using (X1-X0)/(X0), where X0 — recession peak quarter

2. Manufacturing Employment Chart:
FRED — “All Employees: Manufacturing”(http://research.stlouisfed.org/fred2/graph/?id=MANEMP)

@ The Numbers Game With Russ Roberts: A Novel Perspective From Ed Leamer (http://www.advancingafreesociety.org/uncategorized/the-numbers-game-with-russ-roberts-a-novel-perspective-from-ed-leamer/).

lynn
03-17-2013, 09:50 PM
Before Clinton left office he signed the first NAFTA agreement that allowed manufacturing the opportunity to obtain cheaper labor overseas. At that time the government was doing great and had surpluses from 1998 to 2001. The idiots in government didn't care about the consequences to the American workers. During the Bush administration, more NAFTA agreements were signed and this allowed millions of corporations to leave for profit in other countries. 911 attack caused a 2 year recession but we quickly bounced back in 2003. The financial crisis also created by government that wanted banks to loosen the requirements for first time buyers to inflate the housing market. I believe this was done on purpose because they knew that many more corporations were planning on moving overseas and many more people would lose their jobs.

To cash in on the last housing market boom which was created as an illusion so many people could profit on it since they never would have had this opportunity is the reason for why it occurred. The housing boom created an illusion for new businesses to operate on borrowed credit that were risky to begin with but they believed that the housing market couldn't depreciate. Over a million manufacturing businesses from 2008 thru 2010 that employed 500+ employees closed their doors and moved to other countries. What built this country was our American manufacturing businesses and our government would like us to believe we can survive by being a service oriented society, it simply is not true.

The solution, you tell me what that might be because I think we are done.

Chris
06-03-2013, 12:26 PM
The recession ended four years ago, according to the National Bureau of Economic Research. So Obamanomics has had plenty of time to produce a solid recovery. In fact, since the American historical record is the worse the recession, the stronger the recovery, Obama should have had an easy time producing a booming recovery by now.

Obama likes to tout that we are doing better now than at the worst of the recession. But every recovery is better than the recession, by definition. So that doesn’t mean much.

The right measure and comparison for Obama’s record is not to compare the recovery to the recession, but to compare Obama’s recovery with other recoveries from other recessions since the Great Depression. By that measure, what is clear is that Obamanomics has produced the worst recovery from a recession since the Great Depression, worse than what every other President who has faced a recession has achieved since the Great Depression.

In the 10 previous recessions since the Great Depression, prior to this last recession, the economy recovered all jobs lost during the recession after an average of 25 months after the prior jobs peak (when the recession began), according to the records kept by the Federal Reserve Bank of Minneapolis. So the job effects of prior post Depression recessions have lasted an average of about 2 years. But under President Obama, by April, 2013, 64 months after the prior jobs peak, almost 5 years, we still have not recovered all of the recession’s job losses. In April, 2013, there were an estimated 135.474 million American workers employed, still down about 2.6 million jobs from the prior peak of 138.056 million in January, 2008.

Ronald Reagan suffered a severe recession starting in 1981, which resulted from the monetary policy that broke the back of the roaring 1970s inflation. But all the job losses of that recession were recovered after 28 months, with the recovery fueled by traditional pro-growth policies. By this point in the Reagan recovery, 64 months after the recession started, jobs had grown 9.5% higher than where they were when the recession started, representing an increase of about 10 million more jobs. By contrast, in April, 2013, jobs in the Obama recovery were still about 2% below where they were when the recession started, about 2 million less, or a shortfall of about 10 million jobs if you count population growth since the recession started, as discussed below.

Obama’s so-called recovery included the longest period since the Great Depression with unemployment above 8%, 43 months, from February, 2009, when Obama’s so-called stimulus costing nearly $1 trillion was passed, until August, 2012. It also included the longest period since the Great Depression with unemployment at 9.0% or above, 30 months, from April, 2009, until September, 2011. In fact, during the entire 65 years from January, 1948 to January, 2013, there were no months with unemployment over 8%, except for 26 months during the bitter 1981 – 1982 recession, which slayed the historic inflation of the 1970s. That is how inconsistent with the prior history of the American economy President Obama’s extended unemployment has been. That is some fundamental transformation of America.

<snip more and more...>

@ Economically, Could Obama Be America's Worst President? (http://www.forbes.com/sites/peterferrara/2013/06/02/economically-could-obama-be-americas-worst-president/)

Mainecoons
06-03-2013, 12:46 PM
Just a minor point, Lynn, the government "surpluses" under Clinton only happened if you agree that lumping Social Security into the general budget is honest accounting.

I don't see it as such. Honest accounting would not count the temporary surpluses run by a pension scheme that is obligated to pay out same, and more, in the future.

The first thing we need to do for Social Security is to remove it from the general budget, thereby undoing what the Democrats and Republicrats did in order to facilitate stealing from it.

lynn
06-12-2013, 09:32 AM
In 2010 there were 140,459 employed, as of May 2013 there are 144,432 employed. I wouldn't consider this as any kind of substantial growth in employment. We need at least 20 million new jobs to get us in the right direction of improvement. Job growth, preferably in manufacturing and production would be the ideal situation.

Chris
06-12-2013, 09:36 AM
In 2010 there were 140,459 employed, as of May 2013 there are 144,432 employed. I wouldn't consider this as any kind of substantial growth in employment. We need at least 20 million new jobs to get us in the right direction of improvement. Job growth, preferably in manufacturing and production would be the ideal situation.

I believe too that many of those now employed are temporary and part time and law-paying.